In December 2012, the United States Trade Representative (“USTR”) released the results of its Out-of-Cycle Review of Notorious Markets (the “Notorious Markets Review”), identifying more than 30 marketplaces dealing in infringing goods and services and facilitating global piracy and counterfeiting. USTR issued a Request for Public Comment concerning the acts, policies, or practices of foreign countries that deny adequate and effective protection of intellectual property rights (“IPR”) or deny fair and equitable market access to U.S. persons who rely on intellectual property protection under Section 182 of the Trade Act of 1974 (referred to as “Special 301”). In a press release issued by USTR, United States Trade Representative Ron Kirk commented on the direct relationship between intellectual property protection and the U.S. economy by noting that “piracy and counterfeiting, including online sales of pirated and counterfeit goods, is a problem that hurts the U.S. economy, harms some of this nation’s most creative and innovative entrepreneurs and companies and threatens jobs for significant numbers of middle-class American workers.”

The Notorious Markets Review, which is a result of written submissions from the public regarding potential examples of Internet and physical notorious markets, does not comprise an exhaustive list of notorious marketplaces. Rather, it highlights examples that are “the subject of enforcement actions connected with counterfeiting and piracy, or that may merit further investigation for possible IPR infringements” and that “have a negative impact on legitimate businesses and industries.” Although the Review is not intended to reflect a finding of violation of law against the marketplaces identified, USTR “urges the responsible authorities … to use the information contained in the Notorious Markets Review to pursue legal actions where appropriate.”

The Notorious Markets Review does not contain USTR’s analysis of the intellectual property protection and enforcement effectiveness in the countries concerned. Such analysis is contained in the Special 301 Report issued annually in April.

As part of the Special 301 review process, USTR will review public comments and conduct a public hearing to determine which, if any, countries are “Priority Foreign Countries” or should be placed on a “Priority Watch List,” or “Watch List.” Such designations may subject such countries to the procedures set out in sections 301-305 of the Trade Act and/or make them the focus of increased bilateral attention concerning identified problem areas.

The effectiveness of increased bilateral attention stemming from the Special 301 Report is exemplified in the recent announcement that the United States and the Russian Federation entered an Intellectual Property Rights Action Plan to improve IPR protection and enforcement. The 2011 Special 301 report encouraged Russia to work with the United States to set metrics, address IPR priorities including copyright piracy over the Internet, and IPR enforcement generally.

Interested parties should submit comments concerning foreign countries’ acts, policies, or practices concerning the denial of adequate and effective protection of IPR or denial of fair and equitable market access to U.S. persons who rely on intellectual property protection. Comments are due Friday, February 8, 2013. The public hearing will be on Wednesday, February 20, 2013. USTR will publish the 2013 Special 301 Report on or about April 30, 2013.